Langley Company Uses the Allowance Method

question 214

Multiple Choice

Langley Company uses the allowance method.During January 2016,Langley writes off a $500 customer account balance when it becomes clear that the customer will never pay.The entry to record the write-off will:

• A) decrease total assets by $500.
• B) decrease net income for 2016 by $500.
• C) decrease net accounts receivable by $500.
• D) not increase the expenses for 2016.

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Definitions:

Unforeseeable Consequences

Outcomes that could not have been predicted or expected based on the information available at the time of decision or action.

Superseding Causes

Events that occur after a defendant's negligent act, breaking the chain of causation and relieving the defendant of liability.

Comparative Negligence

A legal doctrine under which a plaintiff's damages are reduced by a percentage equal to their degree of fault in causing their injury.

Strict Liability

A legal doctrine holding individuals or entities responsible for damages or injuries caused by their actions or products, regardless of negligence or intent.